STATE INFLUENCED BUSINESS COSTS HAMPER RECOVERY

STATE INFLUENCED BUSINESS COSTS HAMPER RECOVERY

• Energy, transport and legal costs must be reduced. • Jobs will be created when costs are addressed.

ISME, Wednesday 3rd December, 2014.

At the release of the latest Live Register figures today (3rd December), ISME, Irish Small and Medium Enterprises Association, while welcoming the reduction in unemployed, warned that government cost increases are continuing to hamper economic recovery as indigenous SMEs struggle, despite the positive macro-economic figures. The Association called for an Action Plan for Business Cost Reduction, which the Government can influence, to be given priority in the jobs plan which is mainly a business-as-usual box-ticking exercise.

The seasonally adjusted Live Register figure currently stands at 10.7%. There are now 367,100 people signing on the dole, a reduction of 4,100 in the month. Long-term claimants account for 47.2% of the total.

ISME CEO, Mark Fielding commented, “The current rush to finalise the Action Plan for Jobs 2015 is a total farce and a potential waste of resources as long as this government chooses to ignore the incessant creep of state-influenced business costs. In transport, energy, legal and local charges SMEs are being hit for six, without any intervention from the so-called ‘pro-business’ government”.

“Government must realise that it is responsible for creating a business environment in which SMEs have the opportunity to thrive but it is failing in this task. State-influenced business costs continue to rise, slowing down the economic recovery and our ability to retain and improve competitiveness. A more competitive business environment is a prerequisite for economic recovery.”

The Association called on the Government to:

• Focus on cost-competitiveness related to our international competitors.
• Hold fast on public sector wage demands.
• Overhaul the social welfare system, to make it worthwhile for people to work.
• Increase job-rich infrastructure investment to include housing in areas where there are jobs.
• Attack the scourge of ever-increasing black-market activity.
• Address the lack of bank credit for productive SMEs.

“If we are serious about a sustained recovery, we must continue to reduce our overall business costs and increase our competitiveness. Despite recent cost improvements, due to the recession, Ireland remains a high cost location for a range of key business inputs and pressure is mounting on a number of costs including wages, property, utilities, transport and credit”, concluded Fielding.